model economic township limited - reliance industries

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1 MODEL ECONOMIC TOWNSHIP LIMITED MODEL ECONOMIC TOWNSHIP LIMITED FINANCIAL STATEMENTS 2016-17

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Page 1: Model Economic Township Limited - Reliance Industries

1MODEL ECONOMIC TOWNSHIP LIMITED

MODEL ECONOMIC TOWNSHIP LIMITEDFINANCIAL STATEMENTS

2016-17

Page 2: Model Economic Township Limited - Reliance Industries

2 MODEL ECONOMIC TOWNSHIP LIMITED

To Board of Directors

Model Economic Township Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Model Economic Township Limited (“the Company”),

which comprise the Balance sheet as at 31st March, 2017, the Statement of Profit and Loss (including Other Comprehensive Income)

and the Cash Flow Statement and the Statement of Changes in Equity for the year then ended and a summary of significant accounting

policies and other explanatory information.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with

respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial

position), profit or loss (financial performance including other comprehensive income ), cash flows and changes in equity of the

Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind

AS) prescribed under Section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding

the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate

accounting policies; making judgments and estimates that are reasonable and prudent; and maintenance of adequate internal financial

controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation

and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement,

whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. We have taken into

account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit

report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on

Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and

perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone Ind AS

financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material

misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the

auditor considers internal financial control relevant to the Company’s preparation of the standalone Ind AS financial statements that

give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of

expressing an opinion on whether Company has in place an adequate internal financial control system over financial reporting and the

operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the

reasonableness of the accounting estimates made by the Company’s directors, as well as evaluating the overall presentation of the

standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the

standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS

financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with

the accounting principles generally accepted in India including the Ind AS, of the state of affairs (financial position) of the Company

as at 31st March, 2017 and its loss (financial performance including other comprehensive income), its cash flows and changes in equity

for the year ended on that date.

Independent Auditor’s Report

Page 3: Model Economic Township Limited - Reliance Industries

3MODEL ECONOMIC TOWNSHIP LIMITED

Other Matter

The comparative financial information of the Company for the year ended 31st March 2016 and the transition date opening balance

sheet as at 1st April 2015 included in these standalone Ind AS financial statements, are based on the previously issued statutory

financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006, audited by us, our report in

respect of previously issued statutory financial statements for the year ended 31st March 2016 and 31st March 2015 dated 9th April,

2016 and 11th May, 2015 respectively expressed an unmodified opinion, as adjusted for the differences in the accounting principles

adopted by the company on transition date to the Ind AS, which have been audited by us.

Other Matters- restriction of use

The Company has filed a scheme of amalgamation of Devashree Commercials Private Limited, Girisha Commercials Private Limited,

Cluster Commercial Private Limited and Dignity Mercantile Private Limited with it which is pending for necessary approval. These

financial statements have been prepared to assist Reliance Industries Limited, ultimate holding company to prepare its consolidated

financial statements for the year ended 31st March, 2017 and the financial statements may undergo change when the scheme of

amalgamation being approved. Accordingly these financial statements may not be suitable for another purpose. Our report is intended

solely for the company and its holding company and should not be distributed or used by parties other than for the preparation of

consolidated financial statement of holding company. We hereby provide consent that a copy may be provided to auditors of holding

company.

For Chaturvedi & Shah

Chartered Accountants

Firm Reg. No. 101720W

R. Koria

Partner

Membership No.:- 35629

Place: Mumbai

Dated: 10th April, 2017

Page 4: Model Economic Township Limited - Reliance Industries

4 MODEL ECONOMIC TOWNSHIP LIMITED

Notes As at As at As at31st March, 2017 31st March, 2016 1st April, 2015

(`) (`) (`)

ASSETSNon-Current Assets(a) Property, Plant and Equipment 3 144 68 217 1 41 39 431 1 44 18 659(b) Intangible assets 3 84 704 1 23 272 1 61 497(c) Financial Assets

(i) Investment 4 4 00 000 75 000 5 00 000(ii) Other Financial Assets 5 9 91 52 234 8 47 30 767 8 59 44 117

(d) Other Non Current Assets 6 9 18 16 535 7 33 34 349 7 36 79 088

Total Non -Current assets Current assets 20 59 21 690 17 24 02 819 17 47 03 361

(a) Inventories 7 6509 54 15 805 6141 62 37 879 5531 68 66 681(b) Financial Assets

(i) Trade Receivables 8 11 43 396 3 61 740 38 14 570(ii) Cash and cash equivalents 9 1 33 14 661 46 15 742 34 06 028(ii) Other Financial Assets 10 17 68 510 19 35 169 21 75 049

(c) Current Tax Assets (Net) 11 90 41 354 1 15 19 738 96 57 971(d) Other Current Assets 12 60 56 29 064 29 84 78 244 24 22 70 537

Total Current assets 6572 63 12 790 6173 31 48 512 5557 81 90 836

TOTAL ASSETS 6593 22 34 480 6190 55 51 331 5575 28 94 197

EQUITY AND LIABILITIESEquity(a) Equity Share Capital 13 97 00 00 000 97 00 00 000 5 00 000(b) Other Equity 14 4142 09 32 589 23 35 44 223 14 86 43 478

Total Equity 4239 09 32 589 120 35 44 223 14 91 43 478

LiabilitiesNon-Current Liabilities(a) Financial Liabilities

Borrowings 15 1942 59 00 000 5331 34 00 000 4871 24 00 000(b) Provisions 16 13 51 10 937 16 44 91 892 12 96 32 258(c) Deffered Tax Liablity (Net) 17 7 62 22 460 8 85 12 040 8 97 43 107

Total Non-Current Liabilities 1963 72 33 397 5356 64 03 932 4893 17 75 365

Current Liabilities(a) Financial Liabilities

(i) Trade payables 18 2 58 00 864 1 70 38 248 1 83 33 766(ii) Other financial liabilities 19 331 79 24 045 662 95 72 396 619 60 07 521

(b) Provisions 20 6 83 68 579 4 52 03 578 5 87 25 670(c) Other Current Liabilities 21 49 19 75 006 44 37 88 954 39 89 08 397

Total Current Liabilities 390 40 68 494 713 56 03 176 667 19 75 354

Total Liabilities 2354 13 01 891 6070 20 07 108 5560 37 50 719

Total Equity and Liabilities 6593 22 34 480 6190 55 51 331 5575 28 94 197

Significant Accounting PoliciesSee accompaning Notes to the Financial Statements 1 to 45

Balance Sheet as at 31st March, 2017

As per our Report of even date For and on behalf of the Board

For Chaturvedi & Shah Shrivallabh Goyal Anil SharmaFirm Regd No :101720W (Director) (Director)Chartered Accountants DIN- 00021471 DIN- 05212373

R. Koria Sudhir Jain Dheeraj KandhariPartner (Chief Financial Officer) (Company Secretary)Membership No : 35629 Membership No : 084440 Membership No : A20934

Place : Mumbai Place : GurgaonDate :10th Apri1,2017 Date : 10th Apri1,2017

Page 5: Model Economic Township Limited - Reliance Industries

5MODEL ECONOMIC TOWNSHIP LIMITED

Notes 2016-17 2015-16

(`) (`)

Income

Revenue from Operations 22 41 13 24 378 116 74 74 399

Other Income 23 70 68 857 68 34 692

Total Income 41 83 93 235 117 43 09 091

Expenses

Changes in Inventories 24 (367 91 77 926) (609 93 71 198)

Employee Benefits Expense 25 10 84 73 471 8 18 58 387

Finance Cost 26 332 81 49 707 663 29 98 455

Depreciation and Amortization Expense 3 35 17 039 29 12 996

Other Expenses 27 73 65 88 048 46 88 73 814

Total Expenses 49 75 50 339 108 72 72 454

Profit/(Loss) before tax (7 91 57 104) 8 70 36 637

Tax expense

(1) Current Tax - -

(2) Deferred Tax (1 22 89 580) (12 31 067)

(3) Excess Income Tax Provision of earlier year written back - (3 02 314)

(1 22 89 580) (15 33 381)

Profit/(Loss) for the year (6 68 67 524) 8 85 70 018

Other Comprehensive Income

(a) Items that will be reclassified to profit or loss

Income tax relating to items that will be reclassified to profit or loss

(b) Items that will not be reclassified to profit or loss - -

Remeasurement of the defined benefit plan (49 44 110) (15 45 287)

Income tax relating to items that will not be reclassified to profit or loss - -

Total Comprehensive Income for the period (7 18 11 634) 8 70 24 731

Earning per equity share of face value of ` 10 each

(1) Basic (0.74) 2.18

(2) Diluted (0.74) 2.18

Significant Accounting Policies

See accompaning Notes to the Financial Statements 1 to 45

Statement of Profit and Loss for the year ended 31st March, 2017

As per our Report of even date For and on behalf of the Board

For Chaturvedi & Shah Shrivallabh Goyal Anil SharmaFirm Regd No :101720W (Director) (Director)Chartered Accountants DIN- 00021471 DIN- 05212373

R. Koria Sudhir Jain Dheeraj KandhariPartner (Chief Financial Officer) (Company Secretary)Membership No : 35629 Membership No : 084440 Membership No : A20934

Place : Mumbai Place : GurgaonDate : 10th Apri1,2017 Date : 10th Apri1,2017

Page 6: Model Economic Township Limited - Reliance Industries

6 MODEL ECONOMIC TOWNSHIP LIMITED

Cash Flow Statements for the year ended 31st March, 2017

2016-17 2015-16(`) (`)

A: CASH FLOW FROM/ (USED IN) OPERATING ACTIVITIES:Net Profit/(Loss) before Tax as per Profit and Loss Statement (7 91 57 104) 8 70 36 637Adjusted for:Depreciation and Amortisation 35 17 039 29 12 996Provision for Estimated Cost Over Revenue (5 09 665) (1 29 970)Loss/(Profit) on Sale/ Discarding of Property,Plant & Equipment (Net) 41 735 6 46 923Other Comprehensive Income (49 44 110) (15 45 287)Interest Income (63 96 263) (64 65 852)Interest on Unsecured Loan 331 79 24 045 330 96 32 781 662 95 72 396 662 49 91 206

Operating Profit before Working Capital Changes 323 04 75 677 671 20 27 843Adjusted for:Non Current Assets & LiabilitiesOther Current Financial Assets 10 78 533 12 13 350Deffered Tax Liability (1 22 89 580) (12 31 067)Long Term Provisions (2 93 80 955) 3 48 59 633Long term Loans and Advances (1 84 82 185) (5 90 74 187) 3 44 739 3 51 86 655

Current Assets & LiabilitiesTrade Payables 87 62 616 (12 95 518)Other Current Liabilities 4 81 86 053 4 48 80 557Short Term Provisions 2 36 74 668 (1 33 92 123)Inventories (367 91 77 929) (609 93 71 195)Trade Receivables (7 81 656) 34 52 830Other Current Assets (30 70 16 003) (390 63 52 251) (5 60 56 037) (612 17 81 487)

Cash Generated (Used in) from Operations (73 49 50 761) 62 54 33 010Exceptional Item incurred due to Merger - 21 23 986Deferred Tax (1 22 89 580) (12 31 067)Excess Income Tax Provision of earlier year written back - (3 02 314)Tax Paid (Net of Refund of TDS) (24 78 384) 18 61 767

(1 47 67 964) 24 52 372

Net Cash Flow/ (Used in) From Operating Activities (A)(72 01 82 797) 62 29 80 639

B: CASH FLOW FROM INVESTING ACTIVITIES:Payment for Property, Plant & Equipment (43 27 866) (36 00 226)Proceeds from disposal of Property, Plant & Equipment 4 78 874 3 57 758Investment/Divestment (3 25 000) 4 25 000Bank Deposit with more than 12 months maturity (1 55 00 000) -Interest Income 64 28 104 65 54 064

Net Cash Flow (Used in) From Investing Activities (B) (1 32 45 888) 37 36 596

C: CASH FLOW FROM FINANCING ACTIVITIES:Proceeds from Long Term Borrowings 776 45 00 000 690 10 00 000Repayment of Long Term Borrowings (4165 20 00 000) (230 00 00 000)Proceeds From Issue of Equity Share Capital - 96 95 00 000Issue of Zero Coupon Optionally Fully Convertible Debentures 4125 92 00 000 -Interest on Unsecured Loan (662 95 72 396) (619 60 07 521)

Net Cash Flow (Used in) From Financing Activities (C) 74 21 27 604 (62 55 07 521)

Net Increase / (Decrease) in Cash and Cash Equivalents (A+B+C) 86 98 919 12 09 714Opening Balance of Cash and Cash Equivalents 46 15 742 34 06 028Closing Balnce of Cash and Cash Equivalents (Refer note no. 11) 1 33 14 661 46 15 742

Notes :(1) The above cash flow statement has been prepared under the “indirect method” as set out in Ind As-7-Cash Flow Statement(2) Figures in the brackets indicate outflow

As per our Report of even date For and on behalf of the Board

For Chaturvedi & Shah Shrivallabh Goyal Anil SharmaFirm Regd No :101720W (Director) (Director)Chartered Accountants DIN- 00021471 DIN- 05212373

R. Koria Sudhir Jain Dheeraj KandhariPartner (Chief Financial Officer) (Company Secretary)Membership No : 35629 Membership No : 084440 Membership No : A20934

Place : Mumbai Place : GurgaonDate : 10th Apri1,2017 Date : 10th Apri1,2017

Page 7: Model Economic Township Limited - Reliance Industries

7MODEL ECONOMIC TOWNSHIP LIMITED

Statements of Changes in Equity for the year ended 31st March, 2017

A. Equity Share Capital

As at 31 March As at 31 March As at 1 April

2017 2016 2015

Numbers ` Numbers ` Numbers `

Equity Shares at the Begning of the year 9 70 00 000 97 00 00 000 50 000 5 00 000 50 000 5 00 000

Add: Shares Issued during the year - - 9 69 50 000 96 95 00 000 - -

Equity Shares at the End of the year 9 70 00 000 97 00 00 000 9 70 00 000 97 00 00 000 50 000 5 00 000

B. Other Equity

Reserve and Surplus

Equity Capital Retained Other items of Total

component of Reserve Earning Other

compund financial Comprehensive

instruments Income

(specify nature)

As on 01 April 2015

Balance at the beginning of the year 58 52 96 239 (65 30 32 525) (6 77 36 286)

Impact of first time adoption of IND AS 21 63 79 762 21 63 79 762

Restated balance at the beginning of the reporting period -

Total Comprehensive Income for the year -

Dividends -

Transfer to retained earning -

Issued during the Period -

Any other change (to be specified) -

Adjusted figure as per IND AS - 58 52 96 239 (43 66 52 763) - 14 86 43 476

As on 31 March 2016

Balance at the beginning of the year 58 52 96 239 (43 66 52 763) 14 86 43 476

Impact of first time adoption of IND AS 10 33 93 161 10 33 93 161

Merger Expenses adjusted during the year ( 21 23 986) ( 21 23 986)

Total Comprehensive Income for the year (1 48 23 143) ( 15 45 287) (1 63 68 430)

Dividends -

Transfer to retained earning -

Issued during the Period -

Any other change (to be specified) -

Adjusted figure as per IND AS - 58 31 72 253 (34 80 82 745) ( 15 45 287) 23 35 44 221

As on 31 March 2017

Balance at the beginning of the year 58 31 72 253 (34 80 82 745) ( 15 45 287) 23 35 44 221

Impact of first time adoption of IND AS -

Restated balance at the beginning of the reporting period - -

Total Comprehensive Income for the year (6 68 67 524) ( 49 44 110) (7 18 11 634)

Dividends -

Transfer to retained earning -

Zero Coupon Optionally Fully Convertible Debentures

Issued during the Year 4125 92 00 000 4125 92 00 000

Any other change (to be specified) - -

Balance at the end of the Year 4125 92 00 000 58 31 72 253 (41 49 50 269) ( 64 89 397) 4142 09 32 587

Page 8: Model Economic Township Limited - Reliance Industries

8 MODEL ECONOMIC TOWNSHIP LIMITED

A. CORPORATE INFORMATION

1. Model Economic Township Limited is public limited company having its registered office at Plot no. 77 B, third floor,

IFFCO Road, Sector 18, Gurugram-122015, Haryana. The Company was jointly promoted by Reliance Ventures Limited

(a subsidiary of Reliance Industries Limited) and Haryana State Industrial & Infrastructure Development Corporation

Limited (HSIIDC) in terms of the Joint Venture Agreement dated 19th June 2006 to develop and operate Special Economic

Zones (‘SEZ’) in Haryana.

Subsequent to the above, Governent of Haryana approved the expanded scope of the project to include Model Economic

Township (IMT framework) project with a combination of Special Economic Zone (SEZ), Domestic Tariff Areas (DTA),

Logistics Hub, Social Infrastructure etc. in addition to the SEZ. The Joint Venture Agreement has been terminated in

August, 2014. Presently, the company is carrying out development activities on three industrial colonies, for which licenses

were obtained and has continued to consolidate the purchased land as well as to coordinate and obtain various government

approvals etc.

2. The Company is unlisted entity and intermediate wholly owned subsidiary of Reliance Venture Limited and ultimate

subsidiary of Reliance Industries Limited and accordingly in view of Rule 2 of Companies (Accounts) Amendment Rules

2016 notified on 27th July, 2016, the provision related to preparation of Consolidated Financial Statements of the Company

and its subsidiary are not applicable to the Company and hence not prepared.

B. ACCOUNTING POLICIES

B.1 BASIS OF PREPARATION AND PRESENTATION

The financial statements have been prepared on the historical cost basis except for following assets and liabilities which have

been measured at fair value amount:

i) Defined benefit plans - plan assets,

ii) Annuity payment for furure period to land sellers,

iii) Lease rentals receivable from customers on long term lease

The financial statements of the Company have been prepared to comply with the Indian Accounting Standards (“Ind AS”)

including the rules notified under the relevant provisions of the Companies Act 2013.

Upto the year ended March 31, 2016, the Company has prepared its financial statements in accordance with the requirement of

Indian GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules 2006 and considered as

“Previous GAAP”.

These financial statements are the Company’s first Ind AS standalone financial statements.

Company’s financial statements are presented in Indian Rupees, which is its functional currency.

B.2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Property, plant and equipment

Property, plant and equipment are stated at cost, net of recoverable taxes , trade discount and rebates less accumulated

depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost and any cost directly attributable

to bringing the asset to its working condition for its intended use net charges on foreign exchange contracts and adjustments

arising from exchange rate variations attributable to assets.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it

is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured

reliably.

Expenses incurred relating to project, net of income earned during the project development stage prior to its intended use,

are considered as pre - operative expenses and disclosed under Capital Work - in - Progress.

Depreciation on property, plant and equipment is provided using straight line method. Depreciation is provided based on

useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.

Notes on Financial Statements for the year ended 31st March, 2017

Page 9: Model Economic Township Limited - Reliance Industries

9MODEL ECONOMIC TOWNSHIP LIMITED

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each

financial year end and adjusted prospectively, if appropriate.

Gains or losses arising from derecognition of property, plant and equipment are measured as the difference between the net

disposable proceeds and the carrying amount of the asset and are recognised in the statement of profit or loss when the asset

is derecognised.

(b) Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of

ownership to the lessee. All other leases are classified as operating leases.

Company as a lessor

For the assets given under finance lease, the lease premium received initially is recognised as income of the Company at the

inception of the lease. Annual lease rentals receivable in future are recognised at their present value. The corresponding

amount due from the lessee is included in the balance sheet as lease rents receivable.

Lease rents received by the Company are apportioned between finance income and reduction of the lease receivables so as

to achieve a constant rate of interest on the remaining balance of the lease. Finance incomeis recognised immediately in

Statement of profit and loss. Contingent rentals are recognised as income in the periods in which they are received.

(c) Intangible assets

Intangible Assets are stated at cost of acquisition net of recoverable taxes trade discount and rebates less accumulated

amortisation/depletion and impairment loss, if any. Such cost includes purchase price, borrowing costs and any cost directly

attributable to bringing the asset to its working condition for the intended use and net charges on foreign exchange contracts

and adjustments arising from exchange rate variations attributable to the intangible assets.

Subsequent costs are included in the assets’s carrying amount or recognised as a separate asset, as appropriate only when

it is probable that future economic benefits associated with the item will flow to the entity and the cost can be measured

reliably.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal

proceeds and the carrying amount of the asset and are recognised in the Statement of profit or loss when the asset is

derecognised.

A summary of the policies applied to the Company’s intangible assets is, as follows:

Particular Depreciation

Computer Software Over a period of 5 years

Others Over the period of agreement of right to use.

(d) FinanceCost

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalised as part of

the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended

use.

All other borrowing costs are charged to the Statement of Profit and Loss in the period in which they are incurred.

(e) Inventories

Items of inventories are measured at lower of cost and net realisable value.

Inventory comprises of cost of Industrial Township and other Projects under development (Work-in-progress). Cost of

Inventory consists of cost of land, annuity cost, land development expenses, material, services, construction cost, interest

and finance charges and other expenses related to development of projects. In case inventory is purchased on deferred

payment basis, difference between the purchase price for normal credit terms and the amount paid on deferred payment

terms is recognized as interest expense during the credit period.

Notes on Financial Statements for the year ended 31st March, 2017

Page 10: Model Economic Township Limited - Reliance Industries

10 MODEL ECONOMIC TOWNSHIP LIMITED

(f) Impairment of non-financial assets

The Company assesses at each reporting date as to whether there is any indication that any property, plant and equipment

and intangible assets or group of assets, called cash generating units (CGU) may be impaired. If any such indication exists,

the recoverable amount of an asset or CGU is estimated to determine the extent of impairment, if any. Where it is not

possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the

cash-generating unit to which the asset belongs.

An impairment loss is recognised in the Statement of Profit and Loss to the extent, asset’s carrying amount exceeds its

recoverable amount. The Recoverable amount is the higher of asset’s fair value less costs to disposal and value in use.

Value in use is based on the estimated future cash flows discounted to their present value, using a pre-tax discount rate that

reflects current market assessment of the time value of money and the risks specific to the assets.

The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable

amount.

(g) Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it

is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable

estimate can be made of the amount of the obligation.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when

appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of

time is recognised as a finance cost.

(h) Employee Benefits

Short Term Employee Benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by

employees are recognised as an expense during the period when the employees render the services.

Post-Employment Benefits

Defined Contribution Plans

A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a

separate entity. The Company makes specified monthly contributions towards Provident Fund, Superannuation Fund and

Pension Scheme. The Company’s contribution is recognised as an expense in the Statement of Profit and Loss during the

period in which the employee renders the related service.

Defined Benefit Plans

The Company pays gratuity to the employees whoever has completed five years of service with the Company at the time of

resignation/superannuation. The gratuity is paid at 15 days salary for every completed year of service as per the payment of

Gatuity Act 1972.

The gratuity liability amount is contributed to the approved gratuity fund formed exclusively for gratuity payment to the

employees. The gratuity fund has been approved by the tax authorities.

The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method

and spread over the period during which the benefit is expected to be derived from employees’ services.

Re-measurement of defined benefits plans in respect of post-employment and other long term benefits are charged to Other

Comprehensive Income.

(i) Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised in Statement of profit and loss, except

to the extent that it relates to items recognised in the comprehensive income or in equity. In this case, the tax is also

recognised in other comprehensive income or equity.

Notes on Financial Statements for the year ended 31st March, 2017

Page 11: Model Economic Township Limited - Reliance Industries

11MODEL ECONOMIC TOWNSHIP LIMITED

- Current tax

Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities,

based on tax rates and laws that are enacted or substantively enacted at the Balance sheet date.

- Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial

statements and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability

is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end

of the reporting period. The carrying amount of Deferred tax liabilities and assets are reviewed at the end of each reporting

period.

(j) Revenue recognition

Revenue from sale is recognised when the significant risks and rewards of ownership have been transferred to the buyer,

recovery of the consideration is probable, the associated cost can be estimated reliably, there is no continuing effective

control or managerial involvement with the goods and the amount of revenue can be measured reliably.

Revenue from or rendering of services is recognised when the performamce of agreed contractual task has been completed.

The agreement for sale or long term lease of land, including development and provision of infrastructure facilities/services,

where substantial risk & rewards are conveyed to buyer/lessee, is considered as sale of land. Revenue from such sale of

land is recognized on execution of sale/lease deeds, by which substantial risks and rewards are conveyed to Buyers/Lessee.

Revenue in respect of projects under development/construction is recognized on the “Percentage of Completion method”

of accounting which is the percentage of the actual cost incurred, including the cost of land and its development, to the total

estimated cost of the project subject to such actual cost being 25% or more of the total estimated cost. The estimated cost

of the project is based on company’s estimate of the cost expected to be incurred till the final completion of the project and

includes cost of land, annuity costs, construction and development expenses, materials, services, interest and finance

charges and other expenses related to development of projects. The estimates of the costs are revised periodically by the

Companyand effect of such changes in estimates is recognized in the period in which such changes are determined. Any

projected losses on agreements executed are recognized in full when identified. Recognition of revenue relating to agreements

entered into with the buyers, which are subject to fulfillment of obligations/conditions imposed by the statutory authorities,

is postponed till such obligations are discharged. When sale price is realized on deferred payment basis, the difference

between fair value of sale price receivable as per normal credit terms and sale price receivable over deferred payment terms

will be accounted as interest income over the credit period.

Interest income

Interest income from a financial asset is recognised using effective interest rate method.

Dividends

Revenue is recognised when the Company’s right to receive the payment has been established.

C. Critical accounting judgements and key sources of estimationuncertainty:

The preparation of the Company’s financial statements requires management to make judgement, estimates and assumptions that

affect the reported amount of revenue, expenses, assets and liabilities and the accompanying disclosures. Uncertainty about these

assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or

liabilities affected in future periods.

a) Depreciation and useful lives of property plant and equipment

Property, plant and equipment/intangible assets are depreciated/amortized over their estimated useful lives, after taking

into account their estimated residual value. Management reviews the estimated useful lives and residual values of the assets

annually in order to determine the amount of depreciation to be recorded during any reporting period. The useful lives and

residual values are based on the Company’s historical experience with similar assets and take into account anticipated

Notes on Financial Statements for the year ended 31st March, 2017

Page 12: Model Economic Township Limited - Reliance Industries

12 MODEL ECONOMIC TOWNSHIP LIMITED

technological changes. The depreciation/amortization for future periods is adjusted if there are significant changes from

previous estimates.

b) Recoverability of trade receivable

Judgements are required in assessing the recoverability of overdue trade receivables and determining whether a provision

against those receivables is required. Factors considered include the credit rating of the counterparty, the amount and

timing of anticipated future payments and any possible actions that can be taken to mitigate the risk of non-payment.

c) Provisions

Provisions and liabilities are recognized in the period when it becomes probable that there will be a future outflow of funds

resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition

and quantification of the liability require the application of judgement to existing facts and circumstances, which can be

subject to change. The carrying amounts of provisions and liabilities are reviewed regularly and revised to take account of

changing facts and circumstances.

d) Impairment of non-financial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication

exists, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or

Cash Generating Unit’s (CGU) fair value less costs of disposal and its value in use. It is determined for an individual asset,

unless the asset does not generate cash inflows that are largely independent of those from other assets or a groups of assets.

Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is

written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate

that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair

value less costs of disposal, recent market transaction are taken into account, if no such transactions can be identified, an

appropriate valuation model is used.

e) Impairment of financial assets

The impairment provisions for financial assets are based on assumptions about risk of default and expected cash loss rates.

The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based

on Company’s past history, existing market conditions as well as forward looking estimates at the end of each reporting

period.

D. First time adoption of Ind AS

The Company has adopted Ind AS with effect from 1stApril 2016 with comparatives being restated. Accordingly the impact of

transition has been provided in the Opening Retained Earnings as at 1stApril 2015. The figures for the previous period have been

reinstated, regrouped and reclassified wherever required to comply with the requirement of Ind AS and Schedule III.

a) Exemptions from retrospective application

(i) Business combination exemption

The Company has applied the exemption as provided in Ind AS 101 on non-application of Ind AS 103, “Business

Combinations” to business combinations consummated prior to April 1, 2015 (the “Transition Date”), pursuant to which

goodwill/capital reserve arising from a business combination has been stated at the carrying amount prior to the date of

transition under Indian GAAP. The Company has also applied the exemption for past business combinations to acquisitions

of investments in subsidiaries/associates consummated prior to the Transition Date.

(ii) Share-based payment transactions

Not applicable.

Notes on Financial Statements for the year ended 31st March, 2017

Page 13: Model Economic Township Limited - Reliance Industries

13MODEL ECONOMIC TOWNSHIP LIMITED

(iii) Fair value as deemed cost exemption:

The Company has elected to measure items of property, plant and equipment and intangible assets at its carrying value at

the transition date.

(iv) Leases exemption

On the transition date, for the assets given under finance leases, the lease premium received initially is recognised as

income of the Company at the inception of the lease. Annual lease rentals receivable in future are recognised at their present

value. The corresponding amount due from the leasee is included in the balance sheet as lease rents receivable. Lease rents

received by the Company are apportioned between finance income and reduction of the lease receivables so as to achieve

a constant rate of interest on the remaining period of the lease.

(v) Cumulative translation differences

Not Applicable.

(vi) Long Term Foreign Currency Monetary Items

Not applicable.

(vii) Investments in subsidiaries, joint ventures and associates

The Company has elected to measure investment in subsidiaries, joint venture and associate at cost.

(viii) Decommissioning liabilities included in the cost of property, plant and Equipment

Not applicable.

Notes on Financial Statements for the year ended 31st March, 2017

Page 14: Model Economic Township Limited - Reliance Industries

14 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

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Page 15: Model Economic Township Limited - Reliance Industries

15MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

As at 31 March As at 31 March As at 1 April

2017 2016 2015

(`) (`) (`)

4. Non Current Investment

In Equity Shares of Subsidiary Companies

Unquoted at cost, fully paid up

10 000 (previous year Nil) Equity shares of ` 10 each

fully paid up of Girisha Commercials Private Limited 1 00 000 - -

10 000 (previous year Nil) Equity shares of ` 10 each

fully paid up of Devashree Commercials Private Limited 1 00 000 - -

10 000 (previous year Nil) Equity shares of `10 each

fully paid up of Dignity Mercantile Private Limited 1 00 000 - -

10 000 (previous year Nil) Equity shares of ` 10 each

fully paid up of Cluster Commercials Private Limited 1 00 000 - -

Nil Equity shares (Year 2015-2016, 50000 equity shares)

of ` 10 each fully paid up of Resolute Land - - 5 00 000

Consortium Projects Limited

4 00 000 - 5 00 000

Other Investment

Investment in Equity Shares

Unquoted fully paid up fair value through Profit and

Loss (FVTPL)

Nil (Previous year 7500) Equity shares of ` 10 each

fully paid up of Resolute Land Consortium Projects Limited - 75 000 -

- 75 000 -

Total 4 00 000 75 000 5 00 000

4.1. Aggregate value of

Unquoted Investments 4 00 000 75 000 5 00 000

5. Other Non Current Financial Assets

Lease Rent Receivable in Future (Refer note 39) 86 52 234 97 30 767 1 09 44 117

Bank Deposits with more than 12 months maturity 9 05 00 000 7 50 00 000 7 50 00 000

9 91 52 234 8 47 30 767 8 59 44 117

6. Other Non Current Assets

Security Deposits 34 42 197 34 42 197 36 13 197

Amount Recoverable from Prospective Customers 2 93 66 810 1 99 72 000 1 99 72 000

Prepaid Expenses 18 90 514 7 62 644 8 00 080

Balance with Service Tax Authorities 5 71 17 014 4 91 57 508 4 92 93 811

Total 9 18 16 535 7 33 34 349 7 36 79 088

Page 16: Model Economic Township Limited - Reliance Industries

16 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

As at 31 March As at 31 March As at 1 April

2017 2016 2015

(`) (`) (`)

7. Inventories

Work- in- Progress 6509 54 15 805 6141 62 37 879 5531 68 66 681

Total 6509 54 15 805 6141 62 37 879 5531 68 66 681

7.1. During the year, the Company has taken steps to consolidate the purchased land, undertaken land development activities in three

licensed industrial colonies, coordinated and obtained various government approvals etc. The developed land will be provided to

the end users for various purposes, such as industrial, residential, commercial etc. Presently, the intention of the Company is to

either sell the developed land or convey the land on long term lease with upfront lease premium which would qualify to be

finance lease as per the requirements of Indian Accounting Standard - 17 “ Leases”. Accordingly the Company has been classifying

the entire land as Inventory and also interest and finance charges of ` 332 15 77 781 incurred during the period (Previous Year

` 662 95 72 397) have been considered as part of Inventory.

7.2 Inventory includes land valuing ` 1 10 00 000 representing 2 acres vested with the company pursuant to scheme of amalgamtion

approved by Honarable High Court of Punjab & Haryana which is in the name of erstwhile company and yet to be transferred in

the name of Company in revenue records of the Government of Haryana.

8. Trade Receivables

Trade receivables outstanding for a period exceeding

six months from the date they are due for payment

Unsecured, considered good 3 06 803 3 61 740 2 92 990

Outstanding for a period less than six months from the date

they are due for payment

Unsecured, considered good 8 36 593 - 35 21 580

Total 11 43 396 3 61 740 38 14 570

9. Cash & Cash Equivalents

Cash on Hand 67 53 481 21 32 546 11 19 019

Cheques in Hand - 19 10 766 -

Balances with Banks

- in Current Accounts 65 61 180 5 72 430 22 87 009

1 33 14 661 46 15 742 34 06 028

10. Other Current Financial Assets

Interest Accrued on Fixed Deposits 6 89 977 7 21 819 8 10 030

Lease Rent Receivable in Future (Refer note 39) 10 78 533 12 13 350 13 65 019

Total 17 68 510 19 35 169 21 75 049

11. Current tax Assets Net

Tax Deducted at Source 90 41 354 1 15 19 738 96 57 971

90 41 354 1 15 19 738 96 57 971

12. Other Current Assets

Balance with Service Tax Authorities 11 09 447 10 91 505 10 54 025

Prepaid Expenses 27 67 187 27 23 468 18 16 323

Others Advances 60 17 52 430 29 46 63 271 23 94 00 189

Total 60 56 29 064 29 84 78 244 24 22 70 537

Page 17: Model Economic Township Limited - Reliance Industries

17MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

As at 31 March As at 31 March As at 1 April

2017 2016 2015

` Numbers ` Numbers ` Numbers

13. Share Capital

Authorised Share Capital

Equity Shares of `10/- each 500 00 00 000 50 00 00 000 500 00 00 000 50 00 00 000 500 00 00 000 50 00 00 000

500 00 00 000 50 00 00 000 500 00 00 000 50 00 00 000 500 00 00 000 50 00 00 000

Issued, Subscribed & Paid up

Equity Shares of ` 10/- each

fully paid up 97 00 00 000 9 70 00 000 97 00 00 000 9 70 00 000 5 00 000 50 000

Total 97 00 00 000 9 70 00 000 97 00 00 000 9 70 00 000 5 00 000 50 000

13.1. a. Reconciliation of numbers of shares outstanding at the beginning and at the end of the period

As at 31 March As at 31 March As at 1 April

2017 2016 2015

Numbers Numbers Numbers

Shares outstanding at the

beginning of the year 9 70 00 000 50 000 50 000

Add: Shares Issued on right

basis during the year - 9 69 50 000 -

Shares outstanding at the

end of the year 9 70 00 000 9 70 00 000 50 000

b. Details of Shareholding more than 5% in the Company

As at 31 March As at 31 March As at 1 April

2017 2016 2015

Number of % holding Number of % holding Number of % holding

Shares in the class Shares in the class Shares in the class

Holding Company- Reliance

Ventures Limited & its Nominees

(Equity Shares of Rs 10 each

fully paid)

Total 9 70 00 000 100% 9 70 00 000 100% 50 000 100%

9 70 00 000 100% 9 70 00 000 100% 50 000 100%

c. Terms/right attached to equity shares

The company has only one class of equity shares having a par value of ` 10 per share. Each holder of equity shares is entitled to

one vote per share.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the

company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held

by the shareholders.

Page 18: Model Economic Township Limited - Reliance Industries

18 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

As at 31 March As at 31 March As at 1 April

2017 2016 2015

(`) (`) (`)

14. Other Equity

Zero Coupon Optionally Fully Convertible

Debentures

As per last Balance Sheet - - -

Add: Issue of Debentures during the year 4125 92 00 000 - -

Total 4125 92 00 000 - -

14.1. The company has issued 412 59 20 000 number of Zero Coupon Optionally Fully Convertible Unsecured having face value of

` 10/- each to Reliance World Trade Private Limited. Total tenure is 15 years from the date of allotment and Company will settle

the outstanding debentures on expiry of 15 years. The company has the option for early conversion at any time by giving one

month notice. The conversion of debentures will be based on face value as at 31st March, 2016. The equity shares arising out of

conversion of debentures will rank pari passu in all respects with the then outstanding shares of the Company on the date of such

conversion except for dividend if declared shall be paid on pro rata basis from the date of allotment of such equity shares. The

debentures are not marketable and will not be listed on any stock exchange in India and abroad.

Reserves & Surplus

Captial Reserve (Pursuant to Scheme of Amalgmation)

As per last Balance Sheet 58 31 72 253 58 52 96 239 -

Add: Accretion during the year - - 58 56 51 967

Less: Merger Expenses Paid - 21 23 986 3 55 728

58 31 72 253 58 31 72 253 58 52 96 239

Retained Earnings

As per last Balance Sheet (34 80 82 743) (43 66 52 761) -

Add: Net Profit/(Loss) for the Year (6 68 67 524) 8 85 70 018 -

(41 49 50 267) (34 80 82 743) (43 66 52 761)

Other Comprehensive Income (OCI)

As per last Balance Sheet (15 45 287) - -

Add: Movement in OCI (net) during the year (49 44 110) (15 45 287) -

(64 89 397) (15 45 287) -

4142 09 32 589 23 35 44 223 14 86 43 478

Page 19: Model Economic Township Limited - Reliance Industries

19MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

As at 31 March As at 31 March As at 1 April

2017 2016 2015

(`) (`) (`)

15. Borrowings

Unsecured Loans

Loans from Related Parties

From Fellow Subsidiary 1942 59 00 000 5331 34 00 000 4871 24 00 000

Total 1942 59 00 000 5331 34 00 000 4871 24 00 000

Loans outstanding as on 31st March, 2017 are repayable on 31st March,2020 and carrying interest @ 9.75% p.a , which is

payable on yearly basis in the month of May of the succeeding Financial Year. The interest rate is revised to 8.5% w.e.f.

1st April, 2017.

16. Provisions- Non Current

Annuity (Refer note 38) 13 51 10 937 16 44 91 892 12 96 32 258

Total 13 51 10 937 16 44 91 892 12 96 32 258

17. Deffered Tax Liabilty (Net)

At the start of the year 8 85 12 040 8 97 43 107 -

Charge/(credit) to profit or loss (Refer note 43) (1 22 89 580) (12 31 067) -

Charge to other comprehensive income - - -

At the end of the year 7 62 22 460 8 85 12 040 8 97 43 107

18. Trade Payables

Trade Payables 2 57 24 791 1 70 38 248 1 83 33 766

Payable to Related Party 76 073 - -

2 58 00 864 1 70 38 248 1 83 33 766

18.1 Trade Payable

The details of amounts outstanding to Micro, Small and Medium Enterprises based on information available with the company

are as under:

Principal amount due and remaining unpaid - -

Interest due on above and the unpaid interest - -

Interest paid - -

Payment made beyond the appointed day during the year - -

Interest due and payable for the period of delay - -

Interest accrued and remaining unpaid - -

Amount of further interest remaining due and payable in succeeding years - -

19. Other Financial Liabilities

Interest Accrued but not Due on Loans 331 79 24 045 662 95 72 396 619 60 07 521

331 79 24 045 662 95 72 396 619 60 07 521

Page 20: Model Economic Township Limited - Reliance Industries

20 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

As at 31 March As at 31 March As at 1 April

2017 2016 2015

(`) (`) (`)

20. Provisions

(a) Provision for Employee Benefits

Provision For Leave Encashment 43 41 831 58 99 117 49 14 186

Provision for Superannuation 11 32 037 16 194 8 278

(b) Others

Provision for Estimated Cost Over Revenue* 1 25 49 256 1 30 58 923 1 31 88 892

Annuity (Refer note 38) 5 03 45 455 2 62 29 344 4 06 14 314

Total 6 83 68 579 4 52 03 578 5 87 25 670

* The Company has recognized estimated loss based on substantial degree of estimation for estimated cost over revenue from

Industrial Township Project. Actual outflow is expected in the subsequent financial years.

21. Other Current Liabilities

Advance received from Customers 30 14 49 862 27 41 75 275 18 54 19 887

Annuity (Refer note 38) 18 19 56 539 16 47 01 532 14 62 66 089

Other Liabilities* 85 68 605 49 12 147 6 72 22 421

Total 49 19 75 006 44 37 88 954 39 89 08 397

* Includes statutory dues and emloyees benefits

Page 21: Model Economic Township Limited - Reliance Industries

21MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

2016 - 17 2015 - 16

(`) (`)

22. Revenue From Operations

Sale of Land 29 90 17 329 114 95 53 125

Lease Premium 50 87 913 40 24 609

Compensation for Compulsorily Acquisition of Land

(Refer Note 36) 10 03 79 932 81 96 654

Finance Income against Lease Rental 3 22 298 1 70 627

Other Operating Income

Common Service Charges 74 86 615 62 49 162

Less:Service Tax Recovered 9 69 709 65 16 906 7 19 778 55 29 384

Total 41 13 24 378 116 74 74 399

23. Other Income

Interest Income on Fixed Deposit with scheduled bank 63 96 263 64 65 852

Interest Received Others 5 29 000 -

Profit on Sale of Property, Plant & Equipment 16 212 48 585

Miscellaneous Income 1 27 382 3 20 255

Total 70 68 857 68 34 692

24. Changes in Inventories

Projects under Development

(Work-in-Progress at commencement) 6141 62 37 879 5531 68 66 681

Projects under Development

(Work-in-Progress at close) 6509 54 15 805 6141 62 37 879

Total Change in Inventories (367 91 77 926) (609 93 71 198)

25. Employee Benefits Expense

Salaries and wages 9 59 34 812 7 29 86 193

Contribution to Provident and other Fund 63 86 621 40 56 139

Staff welfare expenses 61 52 038 48 16 055

Total 10 84 73 471 8 18 58 387

26. Finance Cost

Interest on Unsecured Loan 332 15 77 781 662 95 72 397

Finance Charges 25 88 622 18 27 726

Finance Charges-Discounting Difference 39 83 304 15 98 332

Total 332 81 49 707 663 29 98 455

Page 22: Model Economic Township Limited - Reliance Industries

22 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

27. Other Expenses

Land Cost 32 02 17 740 12 97 22 966

Land Development Cost 9 00 67 162 1 41 35 324

Annuity Expenses 16 38 94 555 18 18 76 882

Salaries & Wages - Contractors 3 44 39 454 3 81 79 997

Rent 1 42 83 523 1 48 77 219

Rates & Taxes 1 28 862 32 831

Insurance 18 03 413 8 77 331

Telephone Expenses 8 58 358 7 17 003

Travelling & Local Conveyance 1 57 31 649 1 38 63 994

Power & Fuel 54 60 499 54 20 041

Repair & Maintenance

- Plant and Machinery 4 58 869 8 57 107

- Buildings 20 29 469 33 17 196

- Others 28 96 385 7 96 916

Professional & Consultancy Fees 2 00 48 967 2 21 14 001

Security Expenses 2 00 56 791 1 80 91 517

Social Programme Expenses 50 58 259 54 16 105

Payment to Auditors (Refer note 27.1) 23 72 956 21 64 342

Director Sitting Fees 5 57 775 7 48 133

Loss on Sale/ Discarding of Property, Plant & Equipment 57 947 6 95 509

General Expenses 3 66 75 080 1 50 99 370

Reversal of Provision for Estimated Cost Over Revenue (5 09 665) (1 29 970)

Total 73 65 88 048 46 88 73 814

27.1 Payment to Auditors (including Service Tax)

Statutory Audit fees 19 55 000 18 32 000

Tax Audit fees 3 56 500 3 20 600

Certification Fees 40 250 -

Out of pocket expenses 21 206 11 742

Total 23 72 956 21 64 342

28. Earning per share (EPS)

Net Profit / (Loss) after tax as per Statement of

Profit and Loss (`), attributable to Equity Shareholders (7 18 11 634) 8 85 70 018

Weighted Average number of equity shares used as

denominator for calculating EPS 9 70 00 000 3 98 92 760

Basic Earning per share (`) (0.74) 2.22

Diluted Earning per share (`)* (0.74) 2.22

Face Value per equity share (`) 10 10

*The effects of ZOFCD on the earning per share are anti-dilutive and hence, the same is not considered for the purpose of

calculation of dilutive earning per share.

2016 - 17 2015 - 16

(`) (`)

Page 23: Model Economic Township Limited - Reliance Industries

23MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

29 Related Party Disclosures

As per Indian Accounting Standard 24, the disclosures of transactions with the related parties are given below:

(i) List of related parties where control exists and related parties with whom transactions have taken place and the relationship:

S. No. Name of the Related Party Relationship

1 Reliance Ventures Limited (RVL) Holding Company

2 Reliance Industries Limited Holding Company of RVL

3 Resolute Land Consortium Projects Limited Subsidiary Company till 29th February, 2016

(Formerly known as Model Economic Township Ltd.)

4 Reliance Jio Infocomm Limited Fellow Subsidiary of Holding Company

5 Reliance Retail Limited Fellow Subsidiary of Holding Company

6 Reliance Industrial Investments and Holdings Limited Fellow Subsidiary of Holding Company

7 Reliance World Trade Private limited Fellow Subsidiary of Holding Company

8 Devashree Commercials Private Limited Subsidiary Company w.e.f 12th Jan,2017

9 Girisha Commercial Private Limited Subsidiary Company w.e.f 12th Jan,2017

10 Cluster Commercial Private Limited Subsidiary Company w.e.f 12th Jan,2017

11 Dignity Mercantile Private Limited Subsidiary Company w.e.f 12th Jan,2017

12 Shri Shrivallabh Goyal, Whole Time Director

13 Shri Sudhir Jain , Chief Financial Officer Key Managerial Personnel

14 Shri Dheeraj Kandhari, Company Secretary

(ii) Transactions and closing balance during the year with the Related Parties: Amount in `

S. Nature of Transactions Holding Holding Subsidiaries Fellow Key

No. (Excluding reimbursements) Company Company Company Subsidiaries Managerial

of RVL of Holding Personnel

Company

(A) Transactions during the year

1. Unsecured Loans Received - - - 776 45 00 000 -

- - - 690 10 00 000 -

2. Unsecured Loans Repaid - - - 4165 20 00 000 -

- - - 230 00 00 000 -

3. Interest on unsecured loan - - - 332 15 77 781 -

- - - 662 95 72 397 -

4. Lease Rent Received - 4 83 656 - - -

- 4 74 617 - - -

5. Payment to Key Managerial Personnel - - - - 2 65 54 720

- - - - 26 28 330

6. Issue of Zero Coupon Optionally Fully - - - 4125 92 00 000 -

Convertible Debentures - - - - -

7. Corporate Guarantee received - 6 00 000 - - -

- 9 59 10 435 - - -

8. Fixed AssetsPurchased/(Sale)(Net) - - - 1 07 140 -

- - - 1 92 388 -

9. Advance for land purchase - - 1 64 899 - -

- - - - -

10. Other Expenses - - - 66 62 840 -

- - - 25 37 398 -

11. Purchase / (Sale) of investments - - 4 00 000 - -

- - (4 25 000) - -

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24 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

(B) Balance at the end of the year

1. Unsecured Loans - - - 1942 59 00 000 -

- - - 5331 34 00 000 -

2. Investments - - 4 00 000 - -

- - 75 000 - -

3. Interest accrued but not due - - - 331 79 24 045 -

- - - 662 95 72 397 -

Zero Coupon Optionally Fully Convertible Debentures - - - 4125 92 00 000 -

- - - - -

4. Corporate Guarantee received - 37 84 71 410 - - -

- 37 78 71 410 - - -

5. Advance for land purchase - - 22 73 00 000 - -

- - - - -

6. Advance / Payable - - - (76 073) -

- - - 2 000 -

Note: Figures in italics represent that of previous year.

Disclosure in Respect of Material Related Party Transactions during the year:

Unsecured Loans received includes ` 776 45 00 000 (Previous Year Rs. 690 10 00 000) received from Reliance Industrial

Investments And Holdings Limited.

Unsecured Loans repaid includes ̀ 4165 20 00 000 (Previous Year ̀ 230 00 00 000) paid to Reliance Industrial Investments And

Holdings Limited.

Interest on Unsecured Loan to Reliance Industrial Investments And Holdings Limited ` 332 15 77 781 (Previous year

` 662 95 72 397).

Lease rent from Long term lease of land to Reliance Industries Limited ` 4 83 656 (Previous Year ` 4 74 617)

Zero Coupon Optionally Fully Convertible Debentures includes ` 4125 92 00 000 (Previous Year Nil) issued to Reliance World

Trade Private Limited.

Payment to Key Managerial Personnel includes ` 2 65 54 720 (Previous Year ` 15 39 042).

Corporate Guarantee received during the year ` 6 00 000 (Previous Year ` 9 59 10 435)

Fixed Assets purchases include from Reliance Retail Limited ` 1 07 140 (Previous Year ` 1 92 388).

Advance given for land includes ` 1 00 000 (Previous Year Nil) to Girisha Commercial Private Limited, and ` 64 899 (Previous

Year Nil) to Dignity Mercantile Private Limited.

Other Expenses include purchase / services from Reliance Retail Limited ` 66 62 840 (Previous Year ` 25 37 398).

Investment in Resolute Land Consortium Projects Limited has been diluted by 15% amounting ` 75 000 (Previous Year

` 4 25 000). Investment made in Devashree Commercials Private Limited by ̀ 1 00 000 (Previous Year Nil), Girisha Commercial

Private Limited 1 00 000 (Previous Year Nil), Cluster Commercial Private Limited 1 00 000 (Previous Year Nil) and Dignity

Mercantile Private Limited 1 00 000 (Previous Year Nil).

Balance at the end of the year includes:

Unsecured loan taken from Reliance Industrial Investments And Holdings Limited ` 1942 59 00 000 (previous year

` 5331 34 00 000).

Investment in Devashree Commercials Private Limited ` 1 00 000 (Previous Year Nil), Girisha Commercial Private Limited

` 1 00 000 (Previous Year Nil), Cluster Commercial Private Limited ` 1 00 000 (Previous Year Nil) and Dignity Mercantile

Amount in `

S. Nature of Transactions Holding Holding Subsidiaries Fellow Key

No. (Excluding reimbursements) Company Company Company Subsidiaries Managerial

of RVL of Holding Personnel

Company

Page 25: Model Economic Township Limited - Reliance Industries

25MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

Private Limited ` 1 00 000 (Previous Year Nil) .

Interest accrued but not due to Reliance Industrial Investments And Holdings Limited ` 331 79 24 045 (Previous Year

` 662 95 72 397).

Zero Coupon Optionally Fully Convertible Debentures issued to Reliance World Trade Private Limited ` 4125 92 00 000

(Previous Year Nil).

Corporate guarantee provided by Reliance Industries Limited ` 37 84 71 410 (previous year ` 37 78 71 410).

Advance for land purchase to Devashree Commercials Private Limited ` 13 91 00 000 (Previous Year ` 13 91 00 000), Girisha

Commercial Private Limited ` 2 45 00 000 (Previous Year ` 2 71 00 000), Cluster Commercial Private Limited ` 2 05 00 000

(Previous Year ` 2 35 00 000) and Dignity Mercantile Private Limited ` 4 32 00 000 (Previous Year ` 1 95 00 000).

Advance/(Payable) for services to Reliance Retail Limited ` (76 073) (Previous Year ` 2 000)

Note:

The above transactions disclosed are entered during the period of existence of related party relationship. The balance and

transactions are not disclosed after cessation of related party relationship.

29.1 Compensation of Key managerial personnel

The remuneration of director and other member of key management personnel during the year was as follows:

S.N. Particulars 2016-17 2015-16

1. Short term benefits 2 65 54 720 26 28 330

2. Post-employment benefits 71 77 317 66 78 376

Total 3 37 32 037 93 06 706

30 Contingent Liability & Commitments

2016 - 17 2015 - 16

(`) (`)

Contingent Liabilities

(i) Bank Guarantees 37 84 71 410 37 78 71 410

(ii) In respect of private purchase of land by the Company, 1 writ and 1 revision second appeal are pending against the

Company in Punjab and Haryana High Court and 32 civil suits (previous year 45 civil suits) of various nature are pending

in district courts. Company is of the view that most of these cases are not tenable and no material liability will arise.

Commitments

Others

a. Estimated amount of contracts remaining to be executed as on 11 40 91 343 2 82 01 495

31st March, 2017 (net of advances) and not provided for

b. MoUs executed with Land Sellers (net of advances) 3 63 68 791 5 51 16 818

c. Estimated cost to be incurred in connection with development of 25 73 50 446 26 45 23 527

Industrial colonies under license issued by Directorate of Town &

Country Planning, Government of Haryana

d. Rent of offices for unexpired period of rent agreement 11 95 72 444 2 03 34 058

31 Capital Management

The Company adheres to robust capital Management framework. It proactively reviews its debt structure and tries to optimize

the impact of finance cost by adopting suitable debt mix.

Page 26: Model Economic Township Limited - Reliance Industries

26 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

32 Financial Instruments

The financial assets are valued at fair value using discounted cash flow analysis. Amount in `

Fair value measurement hierarchy

Particulars As at 31st March, 2017 As at 31st March, 2016 As at 1st April, 2015

Carrying Level of Carrying Level of Carrying Level of

amount inputs amount inputs amount inputs

used used used

Financial Assets

At Amortized Cost

Trade Receivable 11 43 396 - 3 61 740 - 38 14 570 -

Cash and Cash Equivalent 1 33 14 661 - 46 15 742 - 34 06 028 -

Other Financial Asset 10 09 20 744 - 8 66 65 936 - 8 81 19 166 -

At FVTPL - - - - - -

At FVTOCI - - - - - -

Financials Liability

At Amortised Cost

Trade Payable 2 58 00 864 - 1 70 38 248 - 1 83 33 766 -

Other Financials Liability 331 79 24 045 - 662 95 72 396 - 619 60 07 521

At FVTPL - - - - - -

At FVTOCI - - - - - -

Interest rate risk

The exposure of the Company’s borrowings to interest rate changes at the end of the reporting period is as follows:

Amount in `

Particulars As at As at As at

31st March, 2017 31st March, 2016 1st April, 2015

Long term loans 1942 59 00 000 5331 34 00 000 4871 24 00 000

Impact on interest expenses for the year on 1% change in interest rate

Interest rate sensitivity As at 31st March, 2017 As at 31st March, 2016

Up Move Down Move Up Move Down Move

Impact on equity - - - -

Impact on Profit or Loss - - - -

Credit Risk

Credit risk is the risk that a customer or counter party to a financial instrument fails to perform or pay the amounts due causing

financial loss to the company. Credit risk arises from company’s activities in investments and outstanding receivables from

customers.

The company has prudent and conservative process for managing its credit risk arising in the course of its business activities.

Sale of developed plots /un-developed plots is made on receipt of full amount of consideration. The company has payment delay

risk on recovery of lease rentals and common maintenance charges from customers setting up their units in licensed colonies of

the company.

Liquidity Risk

Liquidity risk arises from the company’s inability to meet its cash flow commitments on time. Since the company is subsidiary

of Reliance Industries Limited, the cash flow deficits are funded by its holding company.

Page 27: Model Economic Township Limited - Reliance Industries

27MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

33 The Company’s activities during the year revolved around development of land and Industrial Township Project (Referred to in

Note no. 1). Considering the nature of Company’s business and operations, there is only one operating segment as per Indian

Accounting Standard 108 – “Operating Segments”.

34 Details of loans given, investments made and guarantee given covered under section 186 (4) of Companies Act 2013 are as

under: Amount in `

S.N. Name of company As at As at

31st March, 2017 31st March, 2016

(A) Investments in full paid up equity shares

1. Resolute Land Consortium Project Limited - 75 000

2. Devashree Commercials Private Limited 1 00 000 -

3. Girisha Commercials Private Limited 1 00 000 -

4. Cluster Commercial Private Limited 1 00 000 -

5. Dignity Mercantile Private Limited 1 00 000 -

35 Details of Specified Bank Notes (SBN) held and transacted during the period 08.11.2016 to 30.12.2016 are as under:

Amount in `

SBN Other Total

denomination

notes

Closing cash in hand as on 08.11.2016 53 70 000 69 48 445 1 23 18 445

(+) Permitted receipts - 2 05 890 2 05 890

(-) Permitted payments - 3 36 000 3 36 000

(-) Amount deposited in Banks 53 70 000 - 53 70 000

Closing cash in in hand as on 30.12.2016 - 68 18 335 68 18 335

36 During the year the Government of Haryana (GoH) has acquired 9.62 acres (Previous Year 1.19 acres) land for the public

purpose out of the private purchased land of the Company. Cost of this land amounting to ` 8 09 15 429 (Previous Year

` 83 79 739) and compensation of ` 10 03 79 932 (Previous Year ` 81 96 654) received by the company from GoH on such

compulsory acquisition of land have been recognized in the Statement of Profit and Loss.

37 During the year, the Company made investments in equity shares of four private companies, namely Devashree Commercials

Private Limited, Girisha Commercials Private Limited, Cluster Commercial Private Limited and Dignity Mercantile Private

Limited, and as a result these companies became wholly owned subsidiaries of the Company on 12th January, 2017. Subsequently,

these subsidiary companies filed a Scheme of Amalgamation (the Scheme) with the Company to Central Government under

section 233 of the Companies Act 2013. The approval of the Central Government is awaited.

38 For the land purchased by the Company, the Company has formulated its own annuity scheme on voluntary basis for the payment

of annuity to land sellers meeting the eligibility criteria and has provided for annuity on annual basis. The amount of undiscounted

annuity provision as at 31st March, 2017 is ` Rs 18 19 56 538 (Previous year `16 47 01 531). In respect of land covered under

licensed area and land sold/leased out, the Company has decided to pay annuity on yearly basis to land sellers, irrespective of

their meeting the eligibility conditions and in such cases, has made the provision for full term of 33 years. The amount of

undiscounted annuity provision for 33 years as at 31st March, 2017 is ` 67 02 83 875 (Previous year ` 66 49 32 564). During the

year, Company has adopted Indian Accounting Standards with transition date being 1st April, 2015 and as per the requirement of

Ind AS- 37 (provisions, contingent liabilities and contingent assets), it has made fair value of such annuity provisions. Thus after

carrying out the adjustment as required, the discounted amount of annuity provision as on 31st March, 2017 stands at

` 36 74 12 930 (Previous year – ̀ 35 54 22 766). Such provisions will be re-measured in subsequent years as per the requirement

of Indian Accounting Standards.

Page 28: Model Economic Township Limited - Reliance Industries

28 MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

39 The Company executed long term lease agreements with three of its customers for a period of 99 years. As per the terms of lease,

it received one time lease premium and in addition receives lease rentals on annual basis during the lease period. Subsequent to

adoption of Indian Accounting Standards with transition date as at 1st April, 2015, it has computed the fair value of lease rentals

receivable in future. It has thus gross lease rentals receivable with discounted value of minimum lease payments receivable as at

end of each of the reporting period as under:

Particulars As at As at As at

31st March, 2017 31st March, 2016 1st April, 2015

1. Gross lease rentals receivable 15 30 06 607 15 45 42 253 15 60 77 899

2. Present value of minimum lease payments receivable 97 30 767 1 09 44 117 1 23 09 136

(a) Not later than one year 10 78 533 12 13 350 13 65 019

(b) Later than one year but not later than five years 38 40 190 43 20 214 48 60 241

(c) Later than five years 48 12 044 54 10 553 60 83 876

3. Unearned Finance Income 14 32 75 840 14 35 98 136 14 37 68 763

40 As per the requirement of Ind AS- 37 (provisions, contingent liabilities and contingent assets), following are the details of

provisions appearing as on each of the following reporting period: (`)

S.N. Particulars As at As at As at

31st March 2017 31st March 2016 1st April, 2015

1. Balance at the beginning 35 54 22 766 31 65 12 661 -

2. Add provisions made during the year 16 38 94 555 18 18 76 882

3. Less:

(a) Amount used/charged against the provisions

during the year 15 58 87 695 14 45 65 109 -

(b) Unused amount reversed during the year - - -

4. Increase during the year in undiscounted

amount arising from unwinding of discounting 39 83 304 15 98 332

5. Balance at the end 36 74 12 930 35 54 22 766 31 65 12 661

41 Employee Benefits

As per Indian Accounting Standard - 19 “Employee Benefits” the disclosures as defined are given below:

Defined Contribution Plans:

Contribution to Defined Contribution Plan, recognized as expenses for the year is as under:- (`)

2016-17 2015-16

Employer’s Contribution to Provident Fund 40 83 366 23 57 466

Employer’s Contribution to Superannuation Fund 2 33 692 1 10 998

Employer’s Contribution to Pension Scheme 7 48 663 6 81 502

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29MODEL ECONOMIC TOWNSHIP LIMITED

Notes on Financial Statements for the year ended 31st March, 2017

Defined Benefit Plan

I. Reconciliation of opening and closing balances of Defined Benefit Obligation (`)

Particulars Gratuity (Funded)

2016-17 2015-16

Defined Benefit Obligation at beginning of the year 68 64 404 56 97 320

Current Service cost 9 11 982 7 52 506

Interest Cost 5 49 152 4 55 786

Liability Transferred In/Acquisitions - 81 965

Actuarial (gain) / loss on obligations due to change in financial assumptions 2 48 963 -

Actuarial (gain) / loss 46 75 502 15 78 486

Benefits paid (7 18 592) (17 01 659)

Defined Benefit obligation at year end 1 25 31 411 68 64 404

II. Reconciliation of opening and closing balances of fair value of Plan Assets (`)

Particulars Gratuity (Funded)

2016-17 2015-16

Fair Value of Plan Assets at beginning of the year 99 68 708 58 52 579

Expected Return on Plan Assets 7 97 497 4 68 206

Liability Transferred In/Acquisitions - 81 965

Actuarial Gain / ( Loss) (19 645) 33 199

Employers Contribution - 52 34 418

Benefits paid (7 18 592) (17 01 659)

Fair value of Plan assets at year end 1 00 27 968 99 68 708

III. Reconciliation of fair value of Assets and Obligations

Particulars Gratuity (Funded)

2016-17 2015-16

Fair value of Plan Assets 1 00 27 968 99 68 708

Present value of Obligation (1 25 31 411) ( 68 64 404)

Net (Liability)/Asset Recognized in the Balance Sheet (25 03 443) 31 04 304

IV. Expenses recognized during the year

Particulars Gratuity (Funded)

2016-17 2015-16

In Income Statement

Current Service Cost 9 11 982 7 52 506

Interest Cost (2 48 345) (12 420)

Net Cost 6 63 637 7 40 086

In Other Comprehensive Income

Actuarial (Gain) / Loss 49 24 465 15 78 486

Return On Plan Assets 19 645 (33 199)

Net (Income)/ Expense For the period Recognized in OCI 49 44 110 15 45 287

Page 30: Model Economic Township Limited - Reliance Industries

30 MODEL ECONOMIC TOWNSHIP LIMITED

V. Investment Details (`)

Particulars Gratuity (Funded)

2016-17 2015-16

Insurance Fund 1 00 27 968 99 68 708

VI. Actuarial assumptions

Particulars Gratuity (Funded)

2016-17 2015-16

2006-08 2006-08

(Ultimate) (Ultimate)

Expected rate of return on Plan Assets (per annum) 7.46% 8.00%

Discount Rate (per annum) 7.46% 8.00%

Rate of escalation in Salary (per annum) 6.00% 6.00%

Rate of Employee Turnover 2.00% 2.00%

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion

and other relevant factors including supply and demand in the employment market. The above information is certified by the

actuary.

The Expected Rate of Return on Plan Assets is determined considering several applicable factors, mainly the composition of

Plan Assets held, assessed risks, historical results of return on Plan Assets and the Company’s policy for Plan Assets.

VII. The expected contributions for Defined Benefit Plan for the next financial year will be in line with FY 2016-17.

VIII.Sensitivity Analysis

Significant Actuarial Assumptions for the determination of the defined benefit obligation are discount trade, expected salary

increase and employee turnover. The sensitivity analysis below, have been determined based on reasonably possible changes of

the assumptions occurring at end of the reporting period , while holding all other assumptions constant. The result of Sensitivity

analysis is given below:

Particulars As at 31st March, 2017 As at 31st March, 2016

(`) (`)

Decrease Increase Decrease Increase

Projected Benefit Obligation on Current Assumption 1 25 31 411 68 64 404

Change in Discounting Rate (Delta Effect of +/-0.5%) 2 47 434 (2 31 134) 2 10 623 ( 1 96 865)

Change in rate of Salary Increase (Delta Effect of +/-0.5%) ( 2 35 284) 2 49 740 (2 01 374) 2 13 692

Change in rate of Employee Turnover (Delta Effect of +/-0.5%) (29 430) 27 864 ( 35 332) 33 483

These plans typically expose the Company to actuarial risks such as: investment risk, interest risk, longevity risk and salary

risk.

Investment risk: The present value of defined benefit plan liability is calculated using a discount rate which is determined byreference to market yields at the end of reporting period on investment with LIC.

Interest risk: A decrease in the interest rate will increase the plan liability; however this will be partially offset by an increasein the return on plan debt investments.

Longevity risk: The present value of defined benefit plan liability is calculated by reference to the best estimate of the mortalityof plan participants both during and after their employment. An increase in the life expectancy of the planparticipants will increase the plan’s liability.

Salary risk: The present value of defined plan liability is calculated by reference to the future salaries of plan participants.

As such, an increase in the salary of the plan participants will increase the plan’s liability.

Notes on Financial Statements for the year ended 31st March, 2017

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31MODEL ECONOMIC TOWNSHIP LIMITED

42 Taxation (`)

Particulars Year ended

31st March, 2017 31st March, 2016

Income tax recognized in Statement of profit and loss

Current tax - -

Deferred tax (1 22 89 580) (12 31 067)

The income tax expenses for the year can be reconciled to the accounting profit as follows: (`)

Particulars Year ended

31st March, 2017 31st March, 2016

Profit before tax ( 7 96 03 609) 8 70 36 637

Applicable tax rate 30.09% 30.09%

Computed tax expense (2 45 97 515) 2 68 94 320

Tax effect of:

Exempted Income - -

Expenses disallowed 1 12 33 356 -

Additional allowances net of MAT credit - (3 10 17 948)

Current tax provision (A) (1 33 64 159) (41 23 628)

Incremental deferred tax liability on account of tangible and

intangible assets 3 33 090 (8 601)

Incremental deferred tax asset on account of financial assets

and other items (1 26 22 670) ( 12 22 465)

Deferred tax provision (B) ( 122 89 580) ( 12 31 066)

Tax expenses recognized in Statement of Profit and Loss (A+B) ( 2 56 53 739) ( 53 54 694)

Effective tax rare (32.22%) (6.15%)

43 The Deferred Tax Liability/Asset comprise of the following: (`)

As at Charge/ Others As at

1st April,2016 (Credit) to 31st March,2017

profit or loss

Deferred Tax Liabilities /Asset in relation to

Property, plant and equipment 7 88 010 3 33 090 - 4 54 920

Financial assets at FVTPL 18 27 831 4 86 205 - 13 41 626

Financial assets at FVTOCI (9 11 27 881) (131 08 875) - (7 80 19 006)

Total (8 85 12 040) (1 22 89 580) - (7 62 24 460)

Notes on Financial Statements for the year ended 31st March, 2017

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32 MODEL ECONOMIC TOWNSHIP LIMITED

44 FIRST TIME IND AS ADOPTION RECONCILIATIONS

44.1 Effect of Ind AS adoption on the stand alone balance sheet as at 31st March, 2016 and 1st April, 2015

`

As at 31st March 2016 As at 1st April 2015

Previous Effect of As per Ind Previous Effect of As per Ind

GAAP transition to AS balance GAAP transition to AS balance

Ind AS sheet Ind AS sheet

Assets

Non-current Assets

Property , Plant and Equipments 1 41 39 431 - 1 41 39 431 1 44 18 659 - 1 44 18 659

Other Intangible Assets 1 23 272 - 1 23 272 1 61 497 - 1 61 497

Financial Assets

Investments 75 000 - 75 000 5 00 000 - 5 00 000

Other non-current assets 14 83 34 348 97 30 768 15 80 65 116 14 86 79 087 1 09 44 117 15 96 23 204

Total non-current assets 16 89 57 420 97 30 768 17 85 36 517 16 37 59 242 1 09 44 117 17 47 03 360

Current Assets

Inventories 6149 20 94 318 (7 58 56 439) 6141 62 37 879 5539 27 23 122 (7 58 56 441) 5531 68 66 681

Financial Assets

Trade Receivables 3 61 740 - 3 61 740 38 14 570 - 38 14 570

Cash and cash equivalents 46 15 742 - 46 15 742 34 06 028 - 34 06 028

Others 7 21 819 - 7 21 819 8 10 030 - 8 10 030

Current Tax Assets (Net) 1 15 19 738 - 1 15 19 738 96 57 971 - 96 57 971

Other current assets 29 84 78 244 12 13 350 29 96 91 594 24 22 70 537 13 65 019 24 36 35 556

Total current assets 6180 77 91 601 (7 46 43 089) 6173 31 48 512 5565 26 82 258 (7 44 91 422) 5557 81 90 836

Total Assets 6197 04 63 653 (6 49 12 324) 6190 55 51 330 5581 64 41 500 (6 35 47 305) 5575 28 94 195

Equity and Liabilities

Equity

Equity share capital 97 00 00 000 - 97 00 00 000 5 00 000 - 5 00 000

Other Equity (8 62 28 701) 31 97 72 924 23 35 44 223 (6 77 36 286) 21 63 79 763 14 86 43 477

Total equity 88 37 71 299 31 97 72 924 120 35 44 223 (6 72 36 286) 21 63 79 763 14 91 43 477

Non-current liabilities

Financial liabilities

Long term borrowings 5331 34 00 000 - 5331 34 00 000 4871 24 00 000 - 4871 24 00 000

Long term Provision –Annuity 64 59 37 867 (48 14 45 975) 16 44 91 892 52 65 93 580 (39 69 61 321) 12 96 32 258

Deferred Tax Provision - 8 85 12 040 8 85 12 040 - 8 97 43 107 8 97 43 107

Total non-current liabilities 5395 93 37 867 (39 29 33 935) 5356 64 03 932 4923 89 93 580 (30 72 18 214) 4893 17 75 365

Current liabilities

Financial liabilities

Trade and other payables 1 70 38 248 - 1 70 38 248 1 83 33 766 - 1 83 33 766

Other financial liabilities 662 95 72 397 - 662 95 72 397 619 60 07 521 - 619 60 07 521

Other Current Liabilities 42 30 56 164 2 07 32 789 44 37 88 953 37 81 95 238 2 07 13 159 39 89 08 396

Short Term Provisions 5 76 87 678 (1 24 84 100) 4 52 03 578 5 21 47 682 65 77 988 5 87 25 670

Total current liabilities 712 73 54 488 82 48 688 713 56 03 176 664 46 84 207 2 72 91 147 664 57 46 010

Total Equity and Liabilities 6197 04 63 654 (6 49 12 324) 6190 55 51 330 5581 64 41 500 (6 35 47 305) 5575 28 94 195

Notes on Financial Statements for the year ended 31st March, 2017

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33MODEL ECONOMIC TOWNSHIP LIMITED

44.2 Effect of Ind AS adoption on Statement of profit and loss for the year ended 31st March, 2016

`

Year ended 31/03/2016

Previous Effect of transition As per Ind AS

GAAP to Ind AS balance sheet

INCOME

Revenue from operations 116 88 59 048 (13 84 648) 116 74 74 399

Other Income 68 34 692 - 68 34 692

Total Income 117 56 93 740 (13 84 648) 117 43 09 091

EXPENDITURE

Change in inventories (609 93 71 196) - ( 609 93 71 198)

Employee benefit expenses 8 34 03 673 (15 45 287) 8 18 58 387

Finance cost 663 14 00 123 15 98 332 663 29 98 455

Depreciation and Amortization expenses 29 12 996 - 29 12 996

Other Expenses 57 40 18 887 (10 51 45 074) 46 88 73 814

Total Expenditure 119 23 64 483 (10 35 46 742) 108 72 72 454

Profit/(loss) before tax (1 66 70 743) (10 21 62 094) 8 70 36 637

Tax expenses

Current tax - - -

Deferred tax - (12 31 067) (12 31 067)

Previous year tax (3 02 314) - (3 02 314)

Profit/(loss) for the year (1 63 68 429) 10 33 93 161 8 85 70 018

44.3 Reconciliation of Profit and Other Equity between Ind AS and previous GAAP (`)

S.N. Nature of Adjustment Profit for the Other EquityYear ended

As at As at As at

31st March, 2016 31st March, 2016 1st April, 2015

Net profit/(loss) /Other Equity as per previous

Indian GAAP (1 63 68 429) (8 62 28 701) (6 77 36 286)

Adjustment for Merger Expenditure 21 23 986 - -

Net profit/(loss) /Other Equity as per previous

Indian GAAP after adjustment of merger expenses (1 84 92 415) (8 62 28 701) (6 77 36 286)

Adjustments for:

1. Fair value of annuity (refer note a) 10 35 46 742 39 73 40 847 29 38 13 733

2. Deferred Tax liability (refer note b) 12 31 067 (8 85 12 040) (8 97 43 107)

3. Fair value of lease rents (refer note c) (13 84 648) 1 09 44 117 1 23 09 136

Subtotal ( 1 to 3) 10 33 93 161 31 97 72 924 21 63 79 762

Net profit/(loss) before OCI/Other equity

as per Ind As 8 49 00 746 23 35 44 223 14 86 43 476

Notes on Financial Statements for the year ended 31st March, 2017

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34 MODEL ECONOMIC TOWNSHIP LIMITED

Notes

(a) Fair value of annuity- As per Ind AS -, the provisions made for annuity payable over a long period is required to be accounted

at discounted value as per Ind-AS as against the full value as per the previous Indian GAAP. Accordingly the difference between

the value of provision for annuity and discounted value has been adjusted to the retained earnings. The consequential impact of

cost of land inventory already sold and projects in development has also been recognized in the retained earnings.-Similarly,

consequential impact on cost of land inventory remaining un-sold has been adjusted in the carrying cost of land inventory.

(b) Deferred tax – The impact of transition adjustments together with Ind-AS mandate of using balance sheet approach (against

profit and loss approach in the previous Indian GAAP) for computation of deferred taxes has resulted in charge to the Reserves,

on the date of transition, with consequential impact to the statement of Profit and Loss for subsequent periods.

(c) Adjustment for property given on lease – As per Ind-AS, the land given on long term lease is required to be treated as finance

lease under Ind-AS where as in the earlier Indian GAPP such transaction were excluded from lease accounting. The lease rentals

receivable in future have been discounted and the resultant change due to change in the accounting policy as on the transition

date has been adjusted to retained earnings.

45. The financial statements were approved for issue by Board of directors on 10th April, 2017.

As per our Report of even date For and on behalf of the Board

For Chaturvedi & Shah Shrivallabh Goyal Anil SharmaFirm Regd No :101720W (Director) (Director)Chartered Accountants DIN- 00021471 DIN- 05212373

R. Koria Sudhir Jain Dheeraj KandhariPartner (Chief Financial Officer) (Company Secretary)Membership No : 35629 Membership No : 084440 Membership No : A20934

Place : Mumbai Place : GurgaonDate : 10th Apri1,2017 Date : 10th Apri1,2017

Notes on Financial Statements for the year ended 31st March, 2017